Internal Control System and Its Influence on Organizational Effectiveness: Case Study of a Village Credit Institution (LPD) in Tabanan Regency

Ida Bagus Anom Yasa (), I Ketut Sukayasa, Ni Made Mega Abdi Utami, I Made Sudana and Ni Komang Swasti Dewi
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Ida Bagus Anom Yasa: Politeknik Negeri Bali, Accounting Department
I Ketut Sukayasa: Politeknik Negeri Bali, Accounting Department
Ni Made Mega Abdi Utami: Politeknik Negeri Bali, Accounting Department
I Made Sudana: Politeknik Negeri Bali, Accounting Department
Ni Komang Swasti Dewi: Politeknik Negeri Bali, Accounting Department

A chapter in Proceedings of the International Conference on Sustainable Green Tourism Applied Science - Social Applied Science 2024 (ICoSTAS-SAS 2024), 2024, pp 107-116 from Springer

Abstract: Abstract Internal control is essential to corporate governance, especially with the increasing use of information technology and globalization. Poor internal control mechanisms, on the other hand, create increased operational inefficiencies, resulting in theft, loss of revenue, and fraudulent conspiracies An effective internal control system assists a company in achieving its goals, providing reliable financial information, and safeguarding assets and other critical resources. It also helps monitor and evaluate an organization’s effectiveness to ensure efficiency and effectiveness. This research examines the Internal Control System and its influence on organizational effectiveness. The study was carried out at the Village Credit Institution (LPD) in Tabanan Regency, with LPD employees and managers participating as respondents. Data was collected using a questionnaire, analyzed using variance-based SEM, and processed using Partial Least Square (PLS). The research results found that the control environment, control activities, risk assessment, and monitoring activities positively and significantly affect organizational effectiveness. Meanwhile, information and communication do not significantly affect organizational effectiveness in LPD Tabanan Regency.

Keywords: Influence; Internal Control System; Organizational Effectiveness (search for similar items in EconPapers)
Date: 2024
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DOI: 10.2991/978-94-6463-622-2_13

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